Study: Fraudsters Focusing on Alternative Means of Payments
- A quantitative study conducted by Javelin in July 2011 with the help of merchants accepting alternative means of payments shows that fraud figures regarding these methods have increased compared to 2010: 27% of the registered fraud cases (vs. 20% the year before).
- Meanwhile, fewer cases of fraud impacting traditional means of payments have been noted: 18% of listed cases relate to debit cards (compared to 30% in 2010). This decrease also concerns cheque and credit card transactions.
- These incidents seem to be affecting small merchants more than others: 31% of all listed fraud cases, as opposed to 12% for mid-sized merchants and 15% for large retailers.
- Javelin’s report insists that PayPal has impacted small merchants’ acceptance of alternative means of payments and has been providing for their increasing acceptance since 2011.
- Small merchants seem naturally more affected as they propose these payment options and because they cannot effort expensive fraud prevention tools.
- The development of alternative means of payments is backed by the increasing use of new distribution channels; fraud prevention solutions are step by step being implemented.